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Hitachi, Ltd. Annual Report 2007Hitachi, Ltd. Annual Report 2007 2322
Software and ServicesIn software and services, sales rose year
on year. Software sales were on a par with
the previous fiscal year. While lower de-
mand for mainframes brought down sales
of platform software, sales of middleware
were healthy, particularly system operation
management software.
Services recorded higher year-on-year
sales due to strong growth in solutions for
financial institutions and in the outsourcing
business.
Earnings increased due to healthy
earnings growth in services in line with
higher sales.
HardwareHardware sales increased from the previ-
ous fiscal year. Storage products posted
higher sales, reflecting healthy growth in
mid-range disk array subsystems, espe-
cially overseas, in addition to significantly
higher sales in HDDs. Server operations
also saw sales rise on the back of marked
This segment recorded a 5% year-on-year increase inrevenues, to ¥2,472.2 billion (U.S.$20,951 million), the resultof growth in services, disk array subsystems and HDDs(Hard Disk Drives). Operating income, however, dropped29%, to ¥60.3 billion (U.S.$511 million), mainly due to awider loss in HDDs.
DisplaysSales rose year on year despite a large
decline in sales caused by the transfer of
operations related to large LCD panels for
TVs to IPS Alpha Technology, Ltd., an
equity-method affiliate formed in a joint
venture with Toshiba Corporation,
Matsushita Electric Industrial Co., Ltd. and
others. Sales growth was driven by a focus
on small and medium-size TFT (Thin Film
Transistor) LCDs and active efforts to
expand sales, including the development of
new fields centered on high picture quality
IPS (In-Plane Switching) technology.
The sector returned to profitability,
achieving a marked improvement over the
previous fiscal year even in the face of
lower sales prices. This improved result
stemmed from changes to the product mix
and rigorous cost cutting.
Segment revenues increased 7% year on year, to¥1,287.4 billion (U.S.$10,911 million), the result of stronggrowth at Hitachi High-Technologies Corporation and inLCD (Liquid Crystal Display) panels. Operating incomesoared 124%, to ¥45.7 billion (U.S.$388 million) as LCDpanel operations became profitable and earnings rose atHitachi High-Technologies.
Information & Telecommunication Systems
Electronic Devices
Review of Operations
1 Terabyte 3.5-inch HDDSmall size finger veinauthentication device
Hitachi High-Technologies’“CG4000”CD-SEM for45nm/32nm generation andbeyond
2.9-inch wide and highdefinition (VGA) IPS LCD
Hitachi Medical’s highmagnetic field MRI system(ECHELON Vega)
Hitachi High-TechnologiesCorporationSales increased year on year. The electronic
device systems business recorded growth,
mainly in CD-measurement SEMs (Critical-
Dimension measurement Scanning Electron
Microscope), etching equipment and other
semiconductor manufacturing equipment,
as well as HDD-related manufacturing
equipment. In life science too, sales
increased, mainly of medical analysis equip-
ment for customers in the U.S. and Europe.
Advanced industrial products also recorded
stronger sales on higher demand for auto-
motive-related components and materials
for FPDs (Flat Panel Displays) and printers.
However, sales declined in information
systems & electronic components mainly
due to lower demand for semiconductor
devices used in mobile phones.
growth in blade servers. Contrastingly, PC
operations posted lower sales, reflecting
the transfer of products for personal use to
the Digital Media & Consumer Products
segment. Telecommunications also
recorded lower sales, mainly as a conse-
quence of sluggish demand for routers in
the Japanese market.
Hardware operations posted a loss, after
a positive result in the previous fiscal year,
despite a healthy rise in earnings in disk
array subsystems. This result was due to a
larger loss in HDD operations resulting from
lower prices, and substantial investments in
the development of next-generation tele-
communications equipment and servers.
In February 2007, Hitachi sold part of its
stake in subsidiary Opnext, Inc. following
the company’s listing on the NASDAQ
stock market in the U.S. As a result, this
company, which offers optical components
for communications applications, is now
treated as an equity-method affiliate for
accounting purposes.
Hitachi, Ltd. Annual Report 2007
Earnings rose due to strong growth in
earnings in electronic device systems and
life science.
Hitachi Medical CorporationSales were lower year on year despite
higher sales of MRI (Magnetic Resonance
Imaging) systems in the U.S., X-ray CT
(Computer Tomography) systems in Japan
and ultrasound diagnostic systems in
Europe. The decline reflected lower sales
of X-ray systems and products made by
other companies.
Earnings declined year on year due to
the impact of lower prices.
A large disk array subsystem
Hitachi, Ltd. Annual Report 2007Hitachi, Ltd. Annual Report 2007 2322
Software and ServicesIn software and services, sales rose year
on year. Software sales were on a par with
the previous fiscal year. While lower de-
mand for mainframes brought down sales
of platform software, sales of middleware
were healthy, particularly system operation
management software.
Services recorded higher year-on-year
sales due to strong growth in solutions for
financial institutions and in the outsourcing
business.
Earnings increased due to healthy
earnings growth in services in line with
higher sales.
HardwareHardware sales increased from the previ-
ous fiscal year. Storage products posted
higher sales, reflecting healthy growth in
mid-range disk array subsystems, espe-
cially overseas, in addition to significantly
higher sales in HDDs. Server operations
also saw sales rise on the back of marked
This segment recorded a 5% year-on-year increase inrevenues, to ¥2,472.2 billion (U.S.$20,951 million), the resultof growth in services, disk array subsystems and HDDs(Hard Disk Drives). Operating income, however, dropped29%, to ¥60.3 billion (U.S.$511 million), mainly due to awider loss in HDDs.
DisplaysSales rose year on year despite a large
decline in sales caused by the transfer of
operations related to large LCD panels for
TVs to IPS Alpha Technology, Ltd., an
equity-method affiliate formed in a joint
venture with Toshiba Corporation,
Matsushita Electric Industrial Co., Ltd. and
others. Sales growth was driven by a focus
on small and medium-size TFT (Thin Film
Transistor) LCDs and active efforts to
expand sales, including the development of
new fields centered on high picture quality
IPS (In-Plane Switching) technology.
The sector returned to profitability,
achieving a marked improvement over the
previous fiscal year even in the face of
lower sales prices. This improved result
stemmed from changes to the product mix
and rigorous cost cutting.
Segment revenues increased 7% year on year, to¥1,287.4 billion (U.S.$10,911 million), the result of stronggrowth at Hitachi High-Technologies Corporation and inLCD (Liquid Crystal Display) panels. Operating incomesoared 124%, to ¥45.7 billion (U.S.$388 million) as LCDpanel operations became profitable and earnings rose atHitachi High-Technologies.
Information & Telecommunication Systems
Electronic Devices
Review of Operations
1 Terabyte 3.5-inch HDDSmall size finger veinauthentication device
Hitachi High-Technologies’“CG4000”CD-SEM for45nm/32nm generation andbeyond
2.9-inch wide and highdefinition (VGA) IPS LCD
Hitachi Medical’s highmagnetic field MRI system(ECHELON Vega)
Hitachi High-TechnologiesCorporationSales increased year on year. The electronic
device systems business recorded growth,
mainly in CD-measurement SEMs (Critical-
Dimension measurement Scanning Electron
Microscope), etching equipment and other
semiconductor manufacturing equipment,
as well as HDD-related manufacturing
equipment. In life science too, sales
increased, mainly of medical analysis equip-
ment for customers in the U.S. and Europe.
Advanced industrial products also recorded
stronger sales on higher demand for auto-
motive-related components and materials
for FPDs (Flat Panel Displays) and printers.
However, sales declined in information
systems & electronic components mainly
due to lower demand for semiconductor
devices used in mobile phones.
growth in blade servers. Contrastingly, PC
operations posted lower sales, reflecting
the transfer of products for personal use to
the Digital Media & Consumer Products
segment. Telecommunications also
recorded lower sales, mainly as a conse-
quence of sluggish demand for routers in
the Japanese market.
Hardware operations posted a loss, after
a positive result in the previous fiscal year,
despite a healthy rise in earnings in disk
array subsystems. This result was due to a
larger loss in HDD operations resulting from
lower prices, and substantial investments in
the development of next-generation tele-
communications equipment and servers.
In February 2007, Hitachi sold part of its
stake in subsidiary Opnext, Inc. following
the company’s listing on the NASDAQ
stock market in the U.S. As a result, this
company, which offers optical components
for communications applications, is now
treated as an equity-method affiliate for
accounting purposes.
Hitachi, Ltd. Annual Report 2007
Earnings rose due to strong growth in
earnings in electronic device systems and
life science.
Hitachi Medical CorporationSales were lower year on year despite
higher sales of MRI (Magnetic Resonance
Imaging) systems in the U.S., X-ray CT
(Computer Tomography) systems in Japan
and ultrasound diagnostic systems in
Europe. The decline reflected lower sales
of X-ray systems and products made by
other companies.
Earnings declined year on year due to
the impact of lower prices.
A large disk array subsystem
Hitachi, Ltd. Annual Report 2007Hitachi, Ltd. Annual Report 2007 2524
Power SystemsSales rose year on year supported by
growth in thermal power plants for overseas
markets, mainly Europe. However, earnings
declined due to repair costs for turbine
damage at certain nuclear power plants in
Japan and cost overruns in construction of
an overseas thermal power plant.
Automotive SystemsSales rose due to the consolidation of
Clarion and the transfer of Hitachi Mobile
Co., Ltd. from the Logistics, Services &
Others segment. Earnings were also up
due to cost cutting.
Urban Planning andDevelopment SystemsBoth sales and earnings were higher than
a year earlier. One factor was healthy
growth in sales of elevators and escala-
tors, mainly in the Chinese market.
Another contributing factor was growth in
Segment revenues rose 8%, to ¥3,022.2 billion(U.S.$25,613 million). This reflected growth mainly inoverseas markets for construction machinery and elevatorsand escalators, in addition to higher sales in automotivesystems resulting from the December 2006 consolidation ofClarion Co., Ltd. Operating income dropped 61% year onyear, to ¥36.3 billion (U.S.$308 million) due to lower earningsin power systems.
Digital MediaSales rose year on year despite a drop in
projection TVs in North America as demand
slid. The higher sales were the result of
strong growth in plasma and LCD TVs and
DVD camcorders.
The sector reported a larger loss than
the previous fiscal year, reflecting lower
sales prices for flat-panel TVs, optical disk
drives, DVD recorders and certain other
products, as well as substantial investments
for marketing in the flat-panel TV business.
Comprehensive AirConditioning andHome AppliancesSales rose year on year. Although sales of
room air conditioners fell in Japan, the
sector recorded strong sales of air condi-
tioning equipment, refrigerators and
washer-dryers.Segment revenues rose 15%, to ¥1,506.0 billion(U.S.$12,763 million), mainly due to higher sales of flat-panelTVs. The segment, however, posted an operating loss of¥58.4 billion (U.S.$495 million), ¥22.7 billion more than theprevious fiscal year. This loss resulted from the impact oflower prices for flat-panel TVs, as well as lower sales of roomair conditioners in Japan.
Power & Industrial Systems
Digital Media & ConsumerProducts
Hitachi delivered this10000-series train toTokyo Metro Co., Ltd.
Clarion’s car navigation Standardized elevator
The sector recorded a drop in earnings,
as lower sales of room air conditioners and
the impact of soaring raw material costs
outweighed a stronger performance in refrig-
erators and washer-dryers thanks to the
contribution of high-end models.
In April 2006, Hitachi Air Conditioning
Systems Co., Ltd. (Power & Industrial
Systems segment) and Hitachi Home &
Life Solutions, Inc. (Digital Media &
Consumer Products segment) were
merged to form Hitachi Appliances, Inc.
the solutions business, which includes
building management services and ESCO
(Energy Service COmpany) operations.
Hitachi ConstructionMachinery Co., Ltd.Both sales and earnings rose year on year, the
result of robust growth in construction machin-
ery for the Japanese and global markets.
Hitachi Plant Technologies,Ltd.In April 2006, Hitachi Plant Engineering &
Construction Co., Ltd. merged with part of
Hitachi, Ltd.’s Industrial Systems Group,
Hitachi Kiden Kogyo, Ltd. and Hitachi
Industries Co., Ltd. with the aim of
strengthening the Hitachi Group’s social
and industrial infrastructure systems
business. Hitachi Plant Engineering & Con-
struction was then renamed Hitachi Plant
Technologies, Ltd. This business integration
lifted sales and earnings year on year.
Plasma TV,DVD camcorder
Hitachi Maxell, Ltd.Sales declined year on year. While Hitachi
Maxell recorded buoyant sales of lithium-
ion rechargeable batteries for mobile
phones, micro batteries and optical com-
ponents, lower sales of computer tapes
due to falling prices and of audio tapes
and video tapes in a shrinking market
brought down overall sales.
However, earnings rose on strong
earnings from lithium-ion rechargeable
batteries and micro batteries as well as the
benefits of rigorous cost cutting.
Hitachi Maxell’s prismaticlithium ion rechargeablebatteries featuring thin typeand high capacity
High capacity Blu-ray Disc forHD (High Definition) content
Room air conditioner,washing machine, refrigerator,vacuum cleaner
Hitachi, Ltd. Annual Report 2007Hitachi, Ltd. Annual Report 2007 2524
Power SystemsSales rose year on year supported by
growth in thermal power plants for overseas
markets, mainly Europe. However, earnings
declined due to repair costs for turbine
damage at certain nuclear power plants in
Japan and cost overruns in construction of
an overseas thermal power plant.
Automotive SystemsSales rose due to the consolidation of
Clarion and the transfer of Hitachi Mobile
Co., Ltd. from the Logistics, Services &
Others segment. Earnings were also up
due to cost cutting.
Urban Planning andDevelopment SystemsBoth sales and earnings were higher than
a year earlier. One factor was healthy
growth in sales of elevators and escala-
tors, mainly in the Chinese market.
Another contributing factor was growth in
Segment revenues rose 8%, to ¥3,022.2 billion(U.S.$25,613 million). This reflected growth mainly inoverseas markets for construction machinery and elevatorsand escalators, in addition to higher sales in automotivesystems resulting from the December 2006 consolidation ofClarion Co., Ltd. Operating income dropped 61% year onyear, to ¥36.3 billion (U.S.$308 million) due to lower earningsin power systems.
Digital MediaSales rose year on year despite a drop in
projection TVs in North America as demand
slid. The higher sales were the result of
strong growth in plasma and LCD TVs and
DVD camcorders.
The sector reported a larger loss than
the previous fiscal year, reflecting lower
sales prices for flat-panel TVs, optical disk
drives, DVD recorders and certain other
products, as well as substantial investments
for marketing in the flat-panel TV business.
Comprehensive AirConditioning andHome AppliancesSales rose year on year. Although sales of
room air conditioners fell in Japan, the
sector recorded strong sales of air condi-
tioning equipment, refrigerators and
washer-dryers.Segment revenues rose 15%, to ¥1,506.0 billion(U.S.$12,763 million), mainly due to higher sales of flat-panelTVs. The segment, however, posted an operating loss of¥58.4 billion (U.S.$495 million), ¥22.7 billion more than theprevious fiscal year. This loss resulted from the impact oflower prices for flat-panel TVs, as well as lower sales of roomair conditioners in Japan.
Power & Industrial Systems
Digital Media & ConsumerProducts
Hitachi delivered this10000-series train toTokyo Metro Co., Ltd.
Clarion’s car navigation Standardized elevator
The sector recorded a drop in earnings,
as lower sales of room air conditioners and
the impact of soaring raw material costs
outweighed a stronger performance in refrig-
erators and washer-dryers thanks to the
contribution of high-end models.
In April 2006, Hitachi Air Conditioning
Systems Co., Ltd. (Power & Industrial
Systems segment) and Hitachi Home &
Life Solutions, Inc. (Digital Media &
Consumer Products segment) were
merged to form Hitachi Appliances, Inc.
the solutions business, which includes
building management services and ESCO
(Energy Service COmpany) operations.
Hitachi ConstructionMachinery Co., Ltd.Both sales and earnings rose year on year, the
result of robust growth in construction machin-
ery for the Japanese and global markets.
Hitachi Plant Technologies,Ltd.In April 2006, Hitachi Plant Engineering &
Construction Co., Ltd. merged with part of
Hitachi, Ltd.’s Industrial Systems Group,
Hitachi Kiden Kogyo, Ltd. and Hitachi
Industries Co., Ltd. with the aim of
strengthening the Hitachi Group’s social
and industrial infrastructure systems
business. Hitachi Plant Engineering & Con-
struction was then renamed Hitachi Plant
Technologies, Ltd. This business integration
lifted sales and earnings year on year.
Plasma TV,DVD camcorder
Hitachi Maxell, Ltd.Sales declined year on year. While Hitachi
Maxell recorded buoyant sales of lithium-
ion rechargeable batteries for mobile
phones, micro batteries and optical com-
ponents, lower sales of computer tapes
due to falling prices and of audio tapes
and video tapes in a shrinking market
brought down overall sales.
However, earnings rose on strong
earnings from lithium-ion rechargeable
batteries and micro batteries as well as the
benefits of rigorous cost cutting.
Hitachi Maxell’s prismaticlithium ion rechargeablebatteries featuring thin typeand high capacity
High capacity Blu-ray Disc forHD (High Definition) content
Room air conditioner,washing machine, refrigerator,vacuum cleaner
Hitachi, Ltd. Annual Report 2007Hitachi, Ltd. Annual Report 2007 2726
Hitachi Chemical Co., Ltd.Sales rose year on year. Sales of electron-
ics-related products increased due to
growth in sales of copper-clad laminates
for printed wiring boards with high heat-
resistance properties, slurry for chemical
mechanical planarization in semiconduc-
tor-related materials, and die bonding
materials for semiconductors. In advanced
performance products, sales rose year on
year due to higher sales of electrical
insulating varnishes, advanced films and
certain other products, although sales of
automotive-related products were
lackluster. In housing equipment and
environmental facilities, sales declined due
to sluggish sales of system baths and
system kitchens, despite growth in natural
refrigerant heat pump water heaters.
Earnings increased year on year due to
growth in semiconductor-related products
and cost cutting.
Segment revenues rose 12%, to ¥1,794.5 billion(U.S.$15,208 million). Operating income climbed 20%, to¥132.3 billion (U.S.$1,122 million).
Hitachi Metals, Ltd.Sales increased year on year. In high-grade
metal products and materials, sales rose
due to higher sales of electronics-related
materials, including sputtering target mate-
rials for LCDs, and automotive components
and materials. In electronics and IT devices,
sales also rose, thanks to much higher
sales of materials and components for IT
equipment and amorphous alloys for trans-
formers. In high-grade functional compo-
nents and equipment, sales rose on
increases in sales of heat-resistant metal
castings and aluminum wheels.
Earnings increased due to the higher
sales, in addition to cost cutting and
price revisions.
In April 2007, Hitachi Metals absorbed
NEOMAX Co., Ltd. after conducting a
tender offer for its shares. This move was
made to consolidate management re-
sources in the magnetic materials busi-
ness, a core business of Hitachi Metals’
electronics and IT devices segment.
Hitachi TransportSystem, Ltd.Sales increased year on year. In the domes-
tic distribution and transport business, sales
rose due to healthy sales growth in the core
third-party logistics solutions business,
mainly in the information and telecommuni-
cations, medical and distribution-related
fields, as well as expansion in the range of
orders from existing customers and the
development of new customers. Sales in
the global distribution and transport
Segment revenues decreased 3% year on year, to¥500.0 billion (U.S.$4,238 million), although revenues atHitachi Capital Corporation were on a par with theprevious fiscal year. Operating income dropped 33%, to¥23.5 billion (U.S.$199 million), mainly due to lowerearnings at Hitachi Capital.
High Functional Materials & Components
Financial Services
Hitachi Chemical’scopper-clad laminates forprinted wiring boards
Hitachi Metals’amorphous alloys fortransformers
Hitachi Cable’s HEV(Hybrid Electric Vehicle)power harnesses
Multifunctional IC card andelectronic toll collectionauto card
business were also up due to higher sales in
local distribution overseas, particularly in
North America and Europe, as well as
import and export-related operations.
Earnings rose year on year due to
growth in the third-party logistics solutions
business and cost cutting.
OthersSales declined at certain overseas general
trading companies due to a fall in large projects
and lower prices for products and services.
Segment revenues were ¥1,213.5 billion (U.S.$10,284 million),largely the same as the previous fiscal year, as firm salesgrowth at Hitachi Transport System, Ltd. was negated bylower sales at some overseas general trading companies.Operating income rose 4%, to ¥20.2 billion (U.S.$171 million),mainly due to higher earnings at Hitachi Transport System.
Logistics, Services & Others
Hitachi Transport System hasopened a joint distribution center forthe medical industry—Kansai Medical Distribution Center—
Hitachi Cable, Ltd.Sales increased year on year. In wires and
cables, sales rose in all product catego-
ries, supported by buoyant demand. In
information and telecommunications net-
working, sales declined due to sluggish
sales of submarine optical fiber cables,
while sales of information networking
solutions and optical and telecommunica-
tions cables were flat. In sophisticated
materials, sales rose due to strong sales of
semiconductor-related products and
automotive-related components.
Earnings increased due to higher sales
and cost cutting.
Hitachi, Ltd. Annual Report 2007
Hitachi Capital CorporationVolume declined year on year. Earnings also
declined due to higher financing costs.
In the finance sector, volume decreased
as Hitachi Capital sought to focus on quality,
such as by reviewing its product mix of
long-term housing loans, in response to a
changing finance market characterized by
higher interest rates. Earnings declined due
to higher financing costs.
In other financial services, volume
increased year on year. This reflected a
focus on corporate cards and account
settlement services in card operations and
an increase in customers in the outsourc-
ing business. Earnings declined due to the
transfer of the finance- and human
resources-related shared services opera-
tions of Hitachi Triple Win Corp. to Hitachi
Management Partner, Corp.
Hitachi, Ltd. Annual Report 2007Hitachi, Ltd. Annual Report 2007 2726
Hitachi Chemical Co., Ltd.Sales rose year on year. Sales of electron-
ics-related products increased due to
growth in sales of copper-clad laminates
for printed wiring boards with high heat-
resistance properties, slurry for chemical
mechanical planarization in semiconduc-
tor-related materials, and die bonding
materials for semiconductors. In advanced
performance products, sales rose year on
year due to higher sales of electrical
insulating varnishes, advanced films and
certain other products, although sales of
automotive-related products were
lackluster. In housing equipment and
environmental facilities, sales declined due
to sluggish sales of system baths and
system kitchens, despite growth in natural
refrigerant heat pump water heaters.
Earnings increased year on year due to
growth in semiconductor-related products
and cost cutting.
Segment revenues rose 12%, to ¥1,794.5 billion(U.S.$15,208 million). Operating income climbed 20%, to¥132.3 billion (U.S.$1,122 million).
Hitachi Metals, Ltd.Sales increased year on year. In high-grade
metal products and materials, sales rose
due to higher sales of electronics-related
materials, including sputtering target mate-
rials for LCDs, and automotive components
and materials. In electronics and IT devices,
sales also rose, thanks to much higher
sales of materials and components for IT
equipment and amorphous alloys for trans-
formers. In high-grade functional compo-
nents and equipment, sales rose on
increases in sales of heat-resistant metal
castings and aluminum wheels.
Earnings increased due to the higher
sales, in addition to cost cutting and
price revisions.
In April 2007, Hitachi Metals absorbed
NEOMAX Co., Ltd. after conducting a
tender offer for its shares. This move was
made to consolidate management re-
sources in the magnetic materials busi-
ness, a core business of Hitachi Metals’
electronics and IT devices segment.
Hitachi TransportSystem, Ltd.Sales increased year on year. In the domes-
tic distribution and transport business, sales
rose due to healthy sales growth in the core
third-party logistics solutions business,
mainly in the information and telecommuni-
cations, medical and distribution-related
fields, as well as expansion in the range of
orders from existing customers and the
development of new customers. Sales in
the global distribution and transport
Segment revenues decreased 3% year on year, to¥500.0 billion (U.S.$4,238 million), although revenues atHitachi Capital Corporation were on a par with theprevious fiscal year. Operating income dropped 33%, to¥23.5 billion (U.S.$199 million), mainly due to lowerearnings at Hitachi Capital.
High Functional Materials & Components
Financial Services
Hitachi Chemical’scopper-clad laminates forprinted wiring boards
Hitachi Metals’amorphous alloys fortransformers
Hitachi Cable’s HEV(Hybrid Electric Vehicle)power harnesses
Multifunctional IC card andelectronic toll collectionauto card
business were also up due to higher sales in
local distribution overseas, particularly in
North America and Europe, as well as
import and export-related operations.
Earnings rose year on year due to
growth in the third-party logistics solutions
business and cost cutting.
OthersSales declined at certain overseas general
trading companies due to a fall in large projects
and lower prices for products and services.
Segment revenues were ¥1,213.5 billion (U.S.$10,284 million),largely the same as the previous fiscal year, as firm salesgrowth at Hitachi Transport System, Ltd. was negated bylower sales at some overseas general trading companies.Operating income rose 4%, to ¥20.2 billion (U.S.$171 million),mainly due to higher earnings at Hitachi Transport System.
Logistics, Services & Others
Hitachi Transport System hasopened a joint distribution center forthe medical industry—Kansai Medical Distribution Center—
Hitachi Cable, Ltd.Sales increased year on year. In wires and
cables, sales rose in all product catego-
ries, supported by buoyant demand. In
information and telecommunications net-
working, sales declined due to sluggish
sales of submarine optical fiber cables,
while sales of information networking
solutions and optical and telecommunica-
tions cables were flat. In sophisticated
materials, sales rose due to strong sales of
semiconductor-related products and
automotive-related components.
Earnings increased due to higher sales
and cost cutting.
Hitachi, Ltd. Annual Report 2007
Hitachi Capital CorporationVolume declined year on year. Earnings also
declined due to higher financing costs.
In the finance sector, volume decreased
as Hitachi Capital sought to focus on quality,
such as by reviewing its product mix of
long-term housing loans, in response to a
changing finance market characterized by
higher interest rates. Earnings declined due
to higher financing costs.
In other financial services, volume
increased year on year. This reflected a
focus on corporate cards and account
settlement services in card operations and
an increase in customers in the outsourc-
ing business. Earnings declined due to the
transfer of the finance- and human
resources-related shared services opera-
tions of Hitachi Triple Win Corp. to Hitachi
Management Partner, Corp.
